European Cities will suffer from software patents

7 March 2005

EUROCITIES is the network of some 100 major cities within the
EU: Norway, Switzerland, Central and Eastern Europe and the New
Independent States (NIS). Eurocities was established in 1986,
there are over 100 million citizens in its member cities.
Catherine Parmentier is Chief Executive Officer of EUROCITIES.

Dear Mrs Parmentier,

The European Council and European Commission are trying to introduce a
legal basis for software patents in Europe. This would expose European
cities to uncalculable and unforseeable risks due to software patent
litigation expenses. That is why we hope you will join us in fighting
these employment and innovation killers.

In addition, city councils throughout Europe do have to overcome the
same difficulties: The number of those who depend on social welfare is
increasing, budgets ar decreasing and citizens expect public services to
provide a better quality than ever before. These apparently
contradictory goals shall be reached by a conversion of the formerly
labour-intensive administration tasks into automated electronic
procedures and structures -- not only within a single administration,
but also between different public services, administration to
citizens and administration to business.

The well known buzzword for this is "eGovernment".

Standardised structures and procedures which are defined and
implemented as the default software to be used across local structures
and administration provide and ideal territory for software patent
litigation claims: Potential claims reach from the grounds of basic
functionality, such as networks, databases and file systems, to the
abstract methods and protocols providing the specific functionality.

As software patents do not require proof of concept or implementation,
the patentee can easily afford to file abstract methods and decide to
give or deny licenses arbitrarily.

This will become a significant cost factor for three main reasons:
Both software developers and users can be asked for almost any amount
of money the software patent holder chooses. Many developers and
companies will not be able to pay such demands and thus go out of
business, turning tax-payers into people in need of social welfare.
Finally, the price of the remaining software companies products will
increase because of the need to refinance their software patent expenses
and also because of reduced competition in the market.

The US Patent and Trademark Office has registered 1185 software
patents [1] dealing with "public service" and 19 explicitly dealing
with "city council" [2]. It is not necessary to mention these keywords
when applying for a software patent, so these are only the tip of the
iceberg and the list is expected to grow rapidly should software patents
become reality.

With the introduction of software patents, European cities would have
to be aware of dramatically increasing costs and an increasingly
difficult legal situation with high risks for the administration.

We would like to recommend that you contact Mr Christian Ude, the mayor
of Munich, who has also become aware of the damaging effects that
software patents have for public services. Should you have further
questions or need additional assistance, please do not hesitate to
contact us.